As the warmer months arrive, customers will soon start venturing to the freezers to pick out their favourite iced treat on a hot summer’s day, providing an opportunity for retailers and suppliers to capitalise.
Already the ice cream category has experienced strong growth, with the AACS State of Industry Half Year Report 2022, showing growth of 6.8 per cent in the first half of 2021 and growing 3.1 per cent in 2022.
Interestingly this growth came from ice cream, 3.3 per cent, and icy pole singles, 13.3 per cent, instead of take-home, which saw a decline of 0.7 per cent as consumers have started getting out and about again.
Elliot Ravioso, Head of Sales Petrol and Convenience at Unilever, said with a significant portion of ice cream purchased on the go, the P&C channel is extremely important.
“If we have learnt anything from Covid-19, it is that consumers are living more flexible lives resulting in the merging of once strict occasions such as working, leisure and consumption. Consequently, consumers are driven even more by convenience and fulfilling their ‘need state’. The ‘needs for today’ mission is the most prolific shopper mission for ice cream, and as such, consumers are favouring quicker shopping trips in nearby convenience channels to instantly satisfy their hunger or craving.
“Unilever sees a great opportunity to leverage the convenient and seasonal locations the P&C channel offers to satisfy the needs of the ice cream consumer. Due to these shifts in consumers’ behaviour, the P&C channel will continue to play an important role in the Australian ice cream market moving forward.”
David Bickle, Category Manager at New Sunrise, said that ice cream is an important part of the convenience market as it speaks directly to the way Australians enjoy the outdoors.
“Australians are out and about, on the move, and enjoying the outdoor lifestyle. Whether it be kids riding their bikes down to the corner store and standing around the freezer or Mums and Dads bringing ice creams home after stopping for fuel.”
Bickle has noticed a trend within the category with the long-term domination of the indulgence segment now being overtaken by snacking as the dominant segment within impulse ice cream.
“Indulgent brands such as Magnum and Connoisseur remain big sellers within our stores, however they have now been eclipsed by snacking, driven by the expansion of brands like Maxibon, Gaytime, Drumstick and the Cadbury’s range.”
Ravioso said Unilever, which produces both Gaytime and Magnum, has consistently seen the iconic Golden Gaytime Original be the number one impulse product in Australian convenience, and this latest quarter is no different.
“Further, due to the highly seasonal nature of the ice cream market, we see the refreshment segment within ice cream greatly over-index in summer where our Calippo Raspberry Pineapple product is the number one product in this segment.”
Unilever’s Ben & Jerry brand is also highly successful within the take home market, representing 50 per cent of all take home sales, and is the number one take home brand.
“We are trying to de-seasonalise the ice cream market by driving sales in the winter months largely driven through our popular Ben & Jerry products Half Baked, Choc Fudge Brownie, and Choc Chop Cookie Dough.”
Bickle said the take home ice cream product has been a notable change within the ice cream market, with the 437ml to one litre tubs becoming very popular across New Sunrise stores.
“Of the take home range sold, around 30 per cent of convenience purchases are ordered from an online platform to be delivered to home or ordered online to be picked up in-store through apps like the Grab it Local app we utilise.
“Tubs have gone from a couple of lines offered in a convenience store to a full door or perhaps even two doors in our larger stores. This is not at the stage where it rivals impulse products, however its growth is notable and has become a strong factor in planning out the category. The decision to place a larger freezer may be balanced with a mid-sized freezer and an upright for take home.”
Peters has experienced impressively stronger growth than the channel average, reporting 9.4 per cent YTD, coming from both the impulse side and the take away side, explained Parita Parekh, Category Manager Convenience and Specialty at Peters.
“With three of the top five brands in impulse ice cream – Peters ice cream portfolio has an offer to suit all consumers. The biggest brand for Peters is Maxibon, with 15.9 per cent value growth (QTR to 22/05/2022), an offer that strongly resonates with convenience shoppers.”
Innovate, innovate, innovate
Innovating the biscuit end of the Maxibon is something Parekh says consumers love and proved successful in April 2021 in a collaboration with popular TV show Rick and Morty with the release of a limited-edition flavour – Pickle Rick Mint.
“The flavour featured a mint slab with mint crisps sandwiched between the iconic Maxibon biscuit and half dipped in a Pickle Rick inspired green coloured white choc with cookie crumbs.”
Building on this success, Peters released Maxibon Waffle On in July this year, the innovation sees Maxibon’s iconic biscuit end transformed and upgraded to two big, golden, sugar-dusted waffles.
Andrea Hamori, Head of Marketing at Peters, said they know how much Australians love Maxibon as it has become a staple in so many freezers.
“Maxibon is all about being ‘born different’ and we know our consumers love different and love bold. So, we are extremely excited to be launching Maxibon Waffle On, our biggest innovation to date. Not only have we transformed the biscuit end for the first time ever, but we are pushing the breakfast boundaries giving our fans a Maxibon take on brekkie they can enjoy anytime, anywhere.”
Unilever has also not been resting on its laurels, with the release of new iterations of its popular Golden Gaytime product, including its new Bites range, which Ravioso believes is a major opportunity with potential to build out this segment in the channel.
“We have created an entire new segment this year in shareable snacking. This year we launched shareable ice cream bites in Golden Gaytime, Magnum, Ben & Jerry’s, which steps ice cream into one of the highest growing areas in convenience. Being able to portion control ice cream, or share an ice cream between friends, on the couch, in the car on a road trip, or out after a meal is an entirely new format and one that we are really excited to bring to Australia.”
Another market Unilever has tapped into is the growing plant-based segment with the launch of Golden Gaytime’s new plant-based range, which still features the iconic biscuit coating with a toffee-flavoured creamy centre.
Annie Lucchitti, Unilever/Streets spokesperson, said the plant-based launch is about opening their products to more Australians regardless of their dietary needs or choices.
“Australians have been buying more plant-based products than ever, and we are thrilled we could bring another Aussie classic into this domain too. Golden Gaytime has been around for over 60 years and recreating this iconic product had to maintain the delicious expectations that come with our classic treat.”
Inside the freezer
Bickle explained that new product development (NPD) plays a factor when New Sunrise is deciding which ice creams to range, as NPD will always provide growth and new lines will constantly draw people to the freezer, but this isn’t the only factor New Sunrise considers.
“Other factors include brand performance and support, it is very important to be aligned to what the ice cream companies, and their brands have worked toward being their key launches, major competitions, or key focuses for the season. Promotions are critical, people will purchase from this category but only if the category provides choice and value.
“Fun; it is important to remember fun and enjoyment are at the centre of the category, the consumer will often be families or children who are perhaps not interested in the decadence of indulgent or the size of a snacking offer. And of course, refreshment, for most regions of Australia, hot summers and an outdoor lifestyle drive the category. The refreshment offers peak in summer but are pretty much enjoyed all year round.”
Hamori agrees that innovation is key in the channel to continue to drive excitement and to attract customers to the freezer, with research showing that shoppers are 76 per cent more highly likely to trial new products in P&C, with 87 per cent of these shoppers repeat purchasing the product1.
“Ice cream in P&C is highly impulsive – 64 per cent of shoppers do not plan to buy ice cream when they enter an outlet1. Because of this, point of sale is critical to drive engagement and penetration. The majority of shoppers will buy an ice cream once they get to a freezer.
“Therefore, the key to conversion is getting shoppers to the ice cream freezer, aided by emotive point of sale along their path to purchase. Peters continues to invest in a broad suite of POS and off location freezer solutions that help engage the consumer in-store across the entire path to purchase. This is becoming increasingly challenging for the category, as we compete for real estate against other food and beverage offers in these outlets.”
Bickle also offered some advice when stocking ice cream products.
“It has become critical that ice cream performs as a category. Electricity costs have significantly risen, and it takes around three times the power to keep an ice cream freezer running in comparison to a drinks fridge. Larger freezers and enormous stock holdings are a luxury the category cannot sustain unnecessarily. We are very precise when placing the category into a store. What sales the category will make and what profit will the category return are key to setting up new stores.
“Large freezers were traditionally placed determined by the space available, it is now more determined by sales opportunity.”
Sources:
1 Peters Category Growth Drivers Research, FivtyFive5, May 2022
This article was written for the October/November issue of C&I Retailing magazine.
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